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Stripe and PayPal are both payment processing platforms that have a lot to offer.
For managing payments or donations, both services are excellent options. But that doesn’t mean that both of them will be a perfect fit for your needs.
In this post, you’ll find a breakdown of platform pricing, features, and much more. Read on to discover which one is most suitable for you.
If you need to receive international payments in different currencies, then try Wise. With the Wise account, you can hold several currencies, and convert them at the mid-market exchange rate (the one you see on Google).
|Table of contents
Stripe and PayPal share a lot in common, but they target different customers. While PayPal is easy to use for small businesses, Stripe has benefits for larger companies.
A key difference is that Stripe has a host of features that make it an excellent pick for developers. Its powerful, customizable developer tools allow the user to create complex platforms.
However, when looking at Stripe vs PayPal, it’s important to look at the pros and cons to both.
PayPal is a well known online payment service. PayPal enables secure online payments with personal and business accounts. You can read the full guide to what PayPal is, and how it works to find out more.
Stripe is also a payment processing platform that lets people send and accept money online. It offers a wide range of developer tools and APIs. Stripe is great for online businesses who can make the most of the developer tools available.
You can read the guide to what Stripe is to find out more about the top features in detail.
If you’re unsure about which option would be best for your business, it’s worth evaluating the services based on the following factors.
Both Stripe and PayPal offer competitive fees.
With PayPal, you can qualify for lower rates if you reach a specific monthly sales volume. The platform also offers discounted transaction rates for confirmed 501 charities and affordable rates for other nonprofits.¹
Stripe offers a discounted processing fee for nonprofits if 80% or more of donations come through the service.²
Understanding the costs associated with each account is key. With a glance at this table, you can compare Stripe³ and PayPal’s⁴ costs across the board.
To delve deeper into the fees, you can also read a detailed guide to Stripe fees.
|Transaction fees (US)
|2.9% + $0.30
|Monthly fee/ set-up cost
|No monthly fees or set up costs
|Fees vary/no setup cost
|ACH transaction fee
|0.8% up to $5
|N/A, only available with Braintree integration
|Chargeback fee (USD)
|$15.00 fee regardless of the outcome of the dispute
|Fixed fee according to currency ($20 in the US)
|Micropayments (purchases < 10%)
|2.9% + $0.30
|4.99% + fixed currency fee
|0.4% per paid invoice
|No subscription fee for sending invoices online. Pay only when you get paid.
|International payment fees
|+1.5 % for international cards and an extra 1% for currency conversion
|+ 1.50% per transaction, with a fixed fee per currency, 4.00% currency conversion, or such other amount as may be disclosed to you during the transaction
|If your business receives payments in several currencies, Wise Business has a solution. You can easily manage and receive multiple currencies with local account details. Simply register for free and pay a one-time fee to get local account details. You can also make payments with the mid-market exchange rate.
With PayPal, you can trade between 25 currencies, and the service is available in more than 200 countries.
Stripe has fewer countries available, at 39, but it supports an impressive 135 currencies.
While Stripe is available in fewer countries, you can connect your US-based business with Stripe Atlas⁵. If you do so, you’ll be able to receive payments through the service wherever your company does business.
If you value ease of use, neither Stripe nor PayPal will let you down. With both services, you can expect a clean user interface that is easy to navigate.
However, it’s worth noting that Stripe can be more tricky to set up due to the extra customization options. So if you want to go the extra mile and make the most of the developer tools, there’ll be a slightly more involved process.
PayPal is the faster of the two services when it comes to accessing funds. With PayPal Standard, you will immediately have access to your funds. For transferring money to your bank account, there’s an average waiting period of 2-4 days, though.
With Stripe, you will have to wait anywhere from an hour up to two days to access the funds.
|Up to 2 days
|Immediate (2-4 days if transferring to a bank account)
It’s a reasonably even playing field between the two services when it comes to customer service.
PayPal has several methods for customers to get in touch. These include an email address, a live chat feature, and a phone line you can call. Stripe has similar customer support features and recently added 24/7 access for both chat and phone line support.
As such, Stripe may just have the edge in customer service, though it’s hard to say definitively.
|24/7 phone and chat support, social media, help center, email
|Email, social media, community forum, help center, live chat, and phone support
Both Stripe and PayPal are PCI compliant. This means that they both meet the high standards set by the Payment Card Industry.
If data portability is a priority for you, Stripe is the best option.
With Stripe, you can securely transfer all of your credit card data to another payment processor.
Unfortunately, PayPal doesn't allow for the same data portability, so if you choose this service, make sure it’s for the foreseeable future.
If you want to make payments directly on your website, Stripe is the best choice as it lets you do so. With PayPal, you will first need to leave the page to sign in to your account.
With both services, you can use a card reader for in-store sales.
Stripe offers EMV-level 1, 2, and 3 pre-certified card readers with end-to-end encryption. The card readers accept contactless payments using services like Apple Pay and Google Pay. You will need to pay for the card reader, though.
PayPal offers its customers a free card reader, though if you need an extra one, you will have to pay.
Now it’s time for the big question: Stripe or PayPal?
Well, given the many nuances of payment processing services, the answer is it depends. While that may be an unsatisfactory answer, the best option for you depends on your business’s needs.
For instance, if you need to make ACH transactions, you should give Stripe a go. PayPal is less accessible in this regard since you will have to do ACH transactions through Braintree.
Another reason to go for Stripe is if you like the idea of having many customization options. Complex coding tools help to create a unique business experience. If you have experience with coding, or have an in-house development team, Stripe could be a good choice for you.
There’s a reason PayPal reigns supreme in the number of users, though, and it’s because it’s well known and easy to use. If you own a small or medium-sized business, PayPal will be easy to process payments with.
Stripe has some pros, especially if you are looking for the following:
- A variety of coding and customization options
- A way to manage payments for large businesses
- A simple way to make ACH payments
Stripe is best for larger businesses who can make the most of the coding and customization features with an in-house developer team.
PayPal is a popular service, and these are the reasons why:
- You can use it for a small or medium-sized business
- You can use it even if you’re new to e-commerce
- You can make the most of the free in-store card reader
PayPal is best for smaller businesses who are looking for a simple and well-known solution.
While the two services have their differences, they share one feature in common: international transaction fees.
If your main priority is saving money on international transfers, then try the Wise Business account. The fees are low and transparent, and you will always get the real exchange rate.
You can even save up to 19x compared to PayPal when making international business payments!
The Wise Business account enables you to pay employees and invoices and receive overseas payments without high recipient or conversion fees. But don’t just take our word for it, 300k+ businesses of all shapes and sizes already use Wise Business each quarter.
All sources checked 13 June 2023
This publication is provided for general information purposes and does not constitute legal, tax or other professional advice from Wise Payments Limited or its subsidiaries and its affiliates, and it is not intended as a substitute for obtaining advice from a financial advisor or any other professional.
We make no representations, warranties or guarantees, whether expressed or implied, that the content in the publication is accurate, complete or up to date.
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